Social Security Q&A: Why Benefit Payments Can Differ

Question: My cousin and I are both retired and get Social Security. We worked for the same employer for years, but he gets a higher Social Security benefit. Why is that?

Answer: Your payments are based on your earnings over your lifetime. Unless you are both the same age, started and stopped work on the exact same dates, and earned the very same amount every year of your careers, you wouldn’t get the same benefit as your cousin. Social Security benefits are based on many years of earnings — generally your highest 35 years. To learn more about Social Security retirement benefits, visit www.socialsecurity.gov and select the “Retirement” link.

Q: I am nearing my full retirement age, but I plan to keep working after I apply for Social Security benefits. Will my benefits be reduced because of my income?

A: No. If you start receiving benefits after you’ve reached your full retirement age, you can work while you receive Social Security and your current benefit will not be reduced because of the earned income. If you keep working, it could mean a higher benefit for you in the future, which can be important to you later in life and increase the future benefit amounts your survivors could receive. If you begin receiving benefits before your full retirement age, your earnings could reduce your monthly benefit amount. After you reach full retirement age, we recalculate your benefit amount to leave out the months when we reduced or withheld benefits due to your excess earnings. Learn more by reading our publication, How Work Affects Your Benefits, at www.socialsecurity.gov/pubs/10069.html.

This column was prepared by the Social Security Administration. For more information, call 800-772-1213 or visit www.socialsecurity.gov.